PPL breaks above 50-day moving average for the first time since June 22nd
PPL Corporation (PPL) Technical Analysis Report for Jul 31, 2020 | by Techniquant Editorial Team
Moving higher for the 4th day in a row, PPL finished the month 3.02% higher at 26.62 after gaining $0.12 (0.45%) today, slightly underperforming the S&P 500 (0.77%). Today's close at 26.62 marks the highest recorded closing price since June 18th. Closing above Thursday's high at 26.55, the market confirmed its breakout through the previous session high after trading up to $0.11 above it intraday.
Daily Candlestick Chart (PPL as at Jul 31, 2020):
Friday's trading range has been $0.60 (2.29%), that's slightly below the last trading month's daily average range of $0.68. Things look different on the weekly timeframe, where the market's trading range of the last week has been slightly above the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for PPL.
One bullish candlestick pattern matches today's price action, the White Candle.
The stock managed to close above the 50-day moving average at 26.54 for the first time since June 22nd. Unable to break through the key technical resistance level at 26.63 (R1), the share closed below it after spiking up to 26.66 earlier during the day. The failure to close above the resistance might increase that levels importance going forward. When prices bounced off a significant resistance level the last time on Monday, PPL actually gained 2.65% on the following trading day.
Although still in a long-term downtrend, the short and medium-term trends both turned bullish already.
As prices are trading close to July's high at 26.73, upside momentum could speed up should PPL mark new highs for the month.
Among the seven market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "4 Consecutive Higher Closes" stand out. While it is usually interpreted as bullish, it has actually shown to be bearish for PPL. Out of 90 times, PPL closed lower 55.56% of the time on the next trading day after the market condition occurred. The optimal exit for swing trading this condition on the short side has been after four trading days, showing a win rate of 56.67% with an average market move of -0.10%.